What this article is proposing is an even more vintage look at the American passenger train. And that's OK.
What the article is suggesting is a return to the long lost local. These were slowly bumped off long before Amtrak took over leaving only the first class limiteds. The local day train fell victim to improved highways. But our highways are crowded. So we need these little local short runs once more.
The fact that you swallowed Amtrak’s cost figures without question is an indication that you don’t really understand this topic. Where is the actual gross revenue numbers? If you showed that you’d see the long distance trains are Amtrak’s revenue driver especially when you consider that the passenger volumes are a third of the other division. It turns out that those $1000 roomettes on the Southwest Chief really add up in revenue much more than a $45 seat to Boston! Amtrak should be forced to report revenue per passenger mile just like airlines and the true state of their business would become much clearer but the NEC holds sway.
This author hasn't done his homework, and got the economics at Amtrak exactly backwards.
Measured by output (measured in annual revenue passenger miles), the NEC is Amtrak's smallest business unit. The inter-regional trains are by far the largest. If one backs out the half of NEC traffic that is defined as "commuter" in nature rather than "intercity," the gap multiplies further.
Since 1975, the US taxpayer has invested well north of $100 billion (in constant dollar terms) into just the NEC, and Amtrak's market share today is lower than it was then, and its apparent financial results in the NEC are worse than ever. We have "earned" a negative rate of return on invested capital doing what this writer advocates.
The cost numbers he quotes are fake--drawn from Amtrak's "APT" cost allocator program, which is NOT GAAP-compliant and thus incapable of reporting financial results of operations. It also fails to report the $2 billion a year in fixed facility costs in the NEC that are covered by federal cash subsidy and deferred maintenance. It's like any corporate fraudulent accounting that hides costs to present a rosy appearance.
The NEC's intercity market share is about 1% and declining steadily. Inter-regional trains' market share in their respective corridors is three to five times the NEC's. That tells us conclusively that it is inter-regional services that people value and use, much more than short corridor services that try to compete--at vast cost--against automobiles and buses in cars' strongest market segment.
And the NEC is already way over-capitalized, because it produces twice the inventory (available seat miles) than it can sell, while inter-regional trains turn away thousands of high-revenue customers a year due to lack of capacity.
What this writer advocates is purely ideological investing, not financially sound investing.
Amtrak *isn't* "laying the groundwork for more of the nostalgic, transcontinental train services that have held passenger rail back for decades". There's a reason why the study is being done by the FRA and is out of Amtrak's hands entirely.
Also most of the passengers on long-distance trains are riding the train to go somewhere, they aren't riding it for the sake of riding it. And this article ignores the political situation around funding.
Thanks for your comment. I used Amtrak as shorthand in the title and the lede, since it's a recognizable entity that most people are familiar with. I explain later on that the FRA is carrying out the study, and that there's a long way to go before Amtrak debuts any of these routes. I probably could have been more clear about the administrative division of responsibilities.
I don't think I ignored the political situation. Towards the end, I describe how there are cases where long distance routes are more politically expedient.
I appreciate that long-distance trains have political advantages, and are a transportation lifeline for many, I stand by the central claim in the piece that most riders in most regions would be far better served by shorter, more frequent lines. Rail advocates and fans should be honest about the myriad downsides of long-distance service.
"I probably could have been more clear about the administrative division of responsibilities."
The article still implies that Amtrak have made a change of position on long-distance services, when they really haven't.
"I stand by the central claim in the piece that most riders in most regions would be far better served by shorter, more frequent lines. Rail advocates and fans should be honest about the myriad downsides of long-distance service."
And I think rail advocates need to understand how criticisms they make will be used by those opposed to all passenger rail, and that in the current political climate for many major cities it is long-distance trains or no trains.
The political climate is the status quo. Advocating for the far more logical adding trains on corridors is not going to the lead to the end of passenger trains in the US. Quite the opposite.
The point is that many states are totally uninterested in funding corridor service, and so long-distance trains are the only hope of getting passenger rail to them.
What this article is proposing is an even more vintage look at the American passenger train. And that's OK.
What the article is suggesting is a return to the long lost local. These were slowly bumped off long before Amtrak took over leaving only the first class limiteds. The local day train fell victim to improved highways. But our highways are crowded. So we need these little local short runs once more.
Terrific article, Ben! I hope the powers that be read it and learn. Thank you.
Thanks so much, Sara!
The fact that you swallowed Amtrak’s cost figures without question is an indication that you don’t really understand this topic. Where is the actual gross revenue numbers? If you showed that you’d see the long distance trains are Amtrak’s revenue driver especially when you consider that the passenger volumes are a third of the other division. It turns out that those $1000 roomettes on the Southwest Chief really add up in revenue much more than a $45 seat to Boston! Amtrak should be forced to report revenue per passenger mile just like airlines and the true state of their business would become much clearer but the NEC holds sway.
This author hasn't done his homework, and got the economics at Amtrak exactly backwards.
Measured by output (measured in annual revenue passenger miles), the NEC is Amtrak's smallest business unit. The inter-regional trains are by far the largest. If one backs out the half of NEC traffic that is defined as "commuter" in nature rather than "intercity," the gap multiplies further.
Since 1975, the US taxpayer has invested well north of $100 billion (in constant dollar terms) into just the NEC, and Amtrak's market share today is lower than it was then, and its apparent financial results in the NEC are worse than ever. We have "earned" a negative rate of return on invested capital doing what this writer advocates.
The cost numbers he quotes are fake--drawn from Amtrak's "APT" cost allocator program, which is NOT GAAP-compliant and thus incapable of reporting financial results of operations. It also fails to report the $2 billion a year in fixed facility costs in the NEC that are covered by federal cash subsidy and deferred maintenance. It's like any corporate fraudulent accounting that hides costs to present a rosy appearance.
The NEC's intercity market share is about 1% and declining steadily. Inter-regional trains' market share in their respective corridors is three to five times the NEC's. That tells us conclusively that it is inter-regional services that people value and use, much more than short corridor services that try to compete--at vast cost--against automobiles and buses in cars' strongest market segment.
And the NEC is already way over-capitalized, because it produces twice the inventory (available seat miles) than it can sell, while inter-regional trains turn away thousands of high-revenue customers a year due to lack of capacity.
What this writer advocates is purely ideological investing, not financially sound investing.
Amtrak *isn't* "laying the groundwork for more of the nostalgic, transcontinental train services that have held passenger rail back for decades". There's a reason why the study is being done by the FRA and is out of Amtrak's hands entirely.
Also most of the passengers on long-distance trains are riding the train to go somewhere, they aren't riding it for the sake of riding it. And this article ignores the political situation around funding.
Thanks for your comment. I used Amtrak as shorthand in the title and the lede, since it's a recognizable entity that most people are familiar with. I explain later on that the FRA is carrying out the study, and that there's a long way to go before Amtrak debuts any of these routes. I probably could have been more clear about the administrative division of responsibilities.
I don't think I ignored the political situation. Towards the end, I describe how there are cases where long distance routes are more politically expedient.
I appreciate that long-distance trains have political advantages, and are a transportation lifeline for many, I stand by the central claim in the piece that most riders in most regions would be far better served by shorter, more frequent lines. Rail advocates and fans should be honest about the myriad downsides of long-distance service.
"I probably could have been more clear about the administrative division of responsibilities."
The article still implies that Amtrak have made a change of position on long-distance services, when they really haven't.
"I stand by the central claim in the piece that most riders in most regions would be far better served by shorter, more frequent lines. Rail advocates and fans should be honest about the myriad downsides of long-distance service."
And I think rail advocates need to understand how criticisms they make will be used by those opposed to all passenger rail, and that in the current political climate for many major cities it is long-distance trains or no trains.
The political climate is the status quo. Advocating for the far more logical adding trains on corridors is not going to the lead to the end of passenger trains in the US. Quite the opposite.
The point is that many states are totally uninterested in funding corridor service, and so long-distance trains are the only hope of getting passenger rail to them.